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Bruce came to personal finance writing the old fashioned way: he didn't have much money, but wanted to do cool things. Clearly, some creativity was in order. From traveling around Europe to paying for a wedding, moving to New York to raising a child, he's figured out how to have fun without spending much money. In the process, he's also learned a few things about how politics and economics can help (or hurt) middle class finances. As DailyFinance's senior features writer, Bruce gets to combine his two favorite things: learning how the world works and explaining what he's learned to his readers.

For much of the past decade, policymakers and analysts have decried America's incredibly low savings rate, noting that U.S. households save a fraction of the money of the rest of the world. Citing a myriad of causes -- from cheap credit to exploitative bank practices -- they've noted that the average family puts away less than 4 percent of its income.

"Wealth Inequality in America," a six-minute video produced by a YouTube user named "Politizane," casts an interesting angle on the plummeting savings rate. Set to depressing piano music and packed with crystal-clear animations, it gives a powerful snapshot of the American economic landscape. Noting that "The top 1 percent own nearly half the country's stocks, bonds, and mutual funds," the video goes on to contrast those impressive holdings with the rest of the country. By comparison, it points out, the bottom 50 percent of earners own only 0.5 percent of those investments.

It isn't hard to see why there is such a yawning gap between the richest Americans and the rest of us. Since 1976, the share of national income earned by the top one percent of workers has nearly tripled, from 9 percent to 24 percent. It's not hard to see why their share has increased: As Clinton administration Labor Secretary Robert Reich recently pointed out, the economy has roughly doubled in size over the last 30 years -- and, in an ideal world, more money in the economy should mean more money in everyone's pocket.

But the distribution of this huge economic bonanza has been startlingly uneven. While the earnings of the top 1 percent have tripled, the average household income has effectively stagnated. Put another way, there's a reason Americans haven't saved: they haven't had much money to save.

In terms of information, Politizane's video isn't offering anything new: Its analysis of American perceptions of wealth distribution, the line between rich and poor and the issue of America's wealth continuum echo stories that have been in the media for years. But there's something about seeing the country's wealth gap in easy-to-follow animations that allows the dry analysis to hit home. Or, as the video puts it, these illustrations make it easier for viewers to "wake up and realize that the reality in this country is not at all what we think it is."

If you have a child in public school, watch out: $406 million is scheduled to get axed from the Head Start budget, which means that 70,000 kids will be kicked out of the program. Another $840 million is going to get pulled out of special education programs, and the White House estimates that another 10,000 teachers' jobs will be put at risk.

If you're planning to fly anywhere, be sure to pack an extra paperback: The TSA's airport security budget will be cut by $323 million, which means that your already-long check-in line will get even longer. And, while we're at it, it looks like there will be about 10 percent fewer air traffic controllers on the job, which is sure to slow things down even more.

Remember the floods and hurricanes that have devastated large swathes of the country over the past few years? Remember all the complaints we heard (and made) about FEMA's sluggish response to those disasters? Well, get ready for more of the same: Sequestration is going to cut $375 million from FEMA's disaster relief budget.

If you like meat -- or any food, really -- now might be a good time to stock up. The food inspectors who make sure your ground beef isn't ground horse and your chicken isn't a petri dish of harmful bacteria are about to be furloughed. Even non-carnivores are facing bad news: After a $206 million cut to its budget, the FDA will have to cut back on most of its food inspection programs.

Sequestration won't be bad news for everyone: If you're a criminal, it might be cause to celebrate. After all, with $355 million being cut from prison funding, convicts could be out on the street sooner than they expected. And, with $480 million being cut from the FBI's budget, if you've committed a crime recently, you might not need to worry as much about covering your tracks.

If you're a virus, things are looking up for you and your relatives, too. The National Institutes of Health are losing $1.6 billion and the Centers for Disease Control will say goodbye to $323 million. From research to public health programs, this will translate into a real downgrade to our nation's health care backbone.

Unfortunately, things won't be great if you want to take a vacation: With $110 million being cut from the National Park Service budget, many park services will be cut back or closed. In other words, if you're one of the 250,000 people who were planning to visit the Grand Canyon this year, you should prepare for a delayed opening and reduced options.

While not all federal student aid programs will take a hit in 2013, sequestration is on track to make things tough for low-income college students. The Supplemental Educational Opportunity Grant program, which can give a needy student up to $4,000 a year, will likely be cut by 8.2 percent, as will federal work study programs. And for students who want to borrow money, student loan origination fees will also go up.

Here's a silver lining to sequestration: It will be educational. For years, this nation has been in the midst of an argument about what role the federal government has and should have in our daily lives. For anyone who has wondered what the government really does for them, the next few months will be an outstanding lesson in where, exactly, your tax money goes.

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1286 Comments

This wealth is based in dollars. If people traded between themselves, lets say I supply my local farmer with electricity and he grows me food, no government power gets anything. Yes I can produce electronics by submitting my schematics to an US company, yes the US and the world can make things locally, the way it was done for thousands of years, and share their craftsmanship with their neighbors, and their profit, without any pencil pusher thousands of miles away to steal a part. All the wealth that the rich and wealthy have could be taken away in a few relative moments by stopping service to them.

Keep in mind that the top 1% of the wealthy pair nearly 50% of all federal income taxes, as well. However, the biggest flaw in this presentation assumes that there is a finite supply of money, or that the pie of wealth is fixed. This isn't a zero sum game where every dollar of wealth held by some rich guy is taken out of the pocket of the poor. Even JFK realized our economy wasn't a zero sum game when he stated, 'a rising tide lifts all boats.' If you want more wealth, the go back to school, become employed in a higher paying profession and work hard.

"Keep in mind that the top 1% of the wealthy pair nearly 50% of all federal income taxes"

Ah, no they dont. most of wealth is kept in capital accounts and they are not taxed. whereas the rich who hold these accounts can get long term loans against this capital accumulation and keep spending and going forever without paying income taxes. almost all silicon valley does it.

"fair" is not an American "value",,,never was,,people here love getting away with crap,,,they absolutely love it , I call them "JACKALS"

We raped the Indians, we raped the Mexicans, WE RAPED THE ESKIMOS, WE RAPED THE BLACK SLAVES,, and we raped the Spaniards to create these wonderful united states of America U.S.A.

Here lets talk tax tables alright ,,in this new digital age of ours...,,ALL INCOME SHOULD BE TAXED AT THE PERSONS TRUE LEVEL...on the tax table,,!NO CAPITAL GAINS LOOPHOLES AND NO "SPECIAL DIVIDENDS",,,FOR STARTERS....

Then how about labor laws forbidding nepotism and employment by quotas,

fair?,,don't make me laugh ,

The top one percent for the most part will all rot in hell after they die , because they alone know how truly they cheated everyone to accumulate their earthly riches.....bible says for good reason,

,it's easier for a camel to pass thru the eye of a needle than for a rich man to enter the kingdom of God......I can't wait for all those 1 % americans when they find out they have accrued 1% or less of good deeds to save their souls...we all need material things for our life here, but its a long way from selling your soul for it .the 1% are in for a terrible surprise that will last them an eternity ,,,,,,that I am positive about ,,,,Wait until they get a taste of fair in the end........EOM.........................

I think people are missing a very important factor. The rich, the super rich or the mega rich can have the all the inspiration, ingenuity, and labor they want but when it comes down to it at the end of the day, it's really the poor, middle and upper class that makes anyone rich. Whether your an industrialist or a pro ball player, none could be rich without the lower classes paying for any commodity.

Companies have been making record setting profits, but hardly any of that goes back to the workers. The rich have been getting richer over the past 20 yrs, and the poor poorer. This is a reason our economy is in shambles. People don't have enough discretionary income to buy anything!

Well I don't know much about the rich, but I feel the real poverty on this globe is a moral one, and why should I respect or support people who have so much money they could wipe their bums with it, when so much needs to be done to clean up our pollution and stop the war machines, so aaron when you say good on them they had products people wanted what bloody products are you talking about, weapons, they cost a lot don't they, and where did we get the idea that if you helped the poor it would make no difference because they would be poor again before long what bullshit, and does wanting to change the rules so it is a fairer world mean dragging the rich down, I thought the new world order was about giving not taking, Mother Teresa says if you want to make a difference go out and feed someone who needs it today, so if you have the money to make change why not give it where it is needed to end suffering, what is the point of accumulating so much wealth that even in one lifetime you don't need it, it's not about taking from the rich, it's about the rich getting some moral backbone and giving back..........and giving morally, we all breath the same air, don't be greedy it's UGLY.